Christina Romer: The Economic Case for Health Care Reform

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The video below comes via FORA.tv (FORA stands for Feed Your Inner Genius).  It is of Christina Romer making the case for Obama’s health care plan at the Commonwealth Club.  This video runs over one hour, and so, should give you a fairly comprehensive view of the economic case Obama is now making for health care reform.

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Note that she says that three-quarters of the rise in health care costs has nothing to do with demographics. And that the number of uninsured is rising. “Doing nothing is not an option.”

See the link below for the report on which this speech is based.  The synopsis pulled from that report is below.

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  • We estimate that slowing the annual growth rate of health care costs by 1.5 percentage points would increase real gross domestic product (GDP), relative to the no-reform baseline, by over 2 percent in 2020 and nearly 8 percent in 2030.
  • For a typical family of four, this implies that income in 2020 would be approximately $2,600 higher than it would have been without reform (in 2009 dollars), and that in 2030 it would be almost $10,000 higher. Under more conservative estimates of the reduction in the growth rate of health care costs, the income gains are smaller, but still substantial.
  • Slowing the growth rate of health care costs will prevent disastrous increases in the Federal budget deficit.
  • Slowing cost growth would lower the unemployment rate consistent with steady inflation by approximately one-quarter of a percentage point for a number of years. The beneficial impact on employment in the short and medium run (relative to the no-reform baseline) is estimated to be approximately 500,000 each year that the effect is felt.
  • Expanding health insurance coverage to the uninsured would increase net economic well-being by roughly $100 billion a year, which is roughly two-thirds of a percent of GDP.
  • Reform would likely increase labor supply, remove unnecessary barriers to job mobility, and help to “level the playing field” between large and small businesses.

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The Economic Case for Health Care Reform – CEA website

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